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Fears Melbourne building company Blint is on the brink of collapse

A Melbourne builder has “disappeared” placing homeowners under a “horrendous” amount of stress as they are left with half finished homes they have poured hundreds of thousands into that they may struggle to complete.

One family impacted are Dean and Nolle Fuller, who have five children between them, and have already shelled out $480,000 to the builder called Blint, since signing on in January.

The couple had demolished their existing home last November and had engaged Blint Builders to build two townhouses for $1.5 million, due to be delivered early next year.

The slab for the two homes was laid and the first floor framing has been done on both but then work started to slow down in the middle of this year, according to Mr Fuller.

But the 54-year-old said alarm bells really started to sound when his wife drove past the site in the first week of June and discovered that the portaloo had been taken away and a tradition was on site collecting his materials.

She then went straight to the builder’s office only to discover it locked up, while her calls went unanswered.

Two days later on June 9, the owner of Blint told the Fullers he was going into voluntary administration but since then they have heard “nothing”, with emails and phone calls left unanswered and the office empty.

Building site targeted

Their building site has been broken into leaving it a “mess”, Mr Fuller said.

“In that time, we have had two lots of vandalizing and trespassing and damage caused to our property, which has been lodged with police,” Mr Fuller told news.com.au.

“We have had a truck back up and dump three to four square meters of rubble and waste material on the property and the truck also smashed the gates down.

“Recently someone turned up and stole the electrical meter box within the property.”

The project manager said the experience had caused an “unbelievable amount of stress and anxiety”.

“We have half a million dollars outlaid on something that is sitting still and… sitting on a block that is wasting away and not covered by insurance potentially,” he said.

“We are in a situation that we may be forced to compromise significantly on what was our dream home to build.

“We are financially impacted and may have sell off things to complete the build as there have been cost increases and delays. The property we have might have to be stripped right back to be rebuilt, notwithstanding that we have got to pay rent and that we have to be out of this rental by Christmas.”

left in limbo

Mr Fuller said his family would have to negotiate to stay in the rental meaning his, including three of their children, would be forced to be crammed into the small property for another 10 to 12 months.

I have added it’s been almost impossible to find out information when “all we want to do is build a house” and instead they are left in “limbo”.

“It takes a lot of time and hours with pursuing legal options and between the Housing Industry Association and banks and insurance companies it’s relentless,” I explained.

“We are all sitting on insurance policies but because the trigger is Blint going into voluntary administration, none of us can trigger the insurance policies. So we are sitting on property we can’t do anything with as we can’t engage new builders.”

Mr Fuller said it’s a “frustrating” experience and just wants answers from the builder.

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Offices seized

Blint Builder’s office in the Melbourne suburb of Highett has also been seized by the landlord.

Legal documents posted on the front door show the landlord has executed their right to re-entry, terminating the lease and demanding all property be removed and the keys be returned.

The legal notice also revealed that Blint Builders owe the landlord close to $14,000 in unpaid rent and rates.

Emails to Blint are undeliverable, while news.com.au has called, left voicemails and sent text messages to the builder but has not heard back.

‘Horrifying strain’

Another family who are under “horrendous strain” are Tony and Jo Firman and their two children, who are building a home specially designed for her disability.

Mrs Firman has multiple sclerosis and the couple were building a home to meet her needs in the Melbourne suburb of Mordialloc, which included a swimming pool.

They had demolished the original home and signed up to build their $1.2 million house with Blint, which was scheduled to be finished in mid February.

The couple said they have paid $1.14 million so far to the builder and the house is at lock up stage but no work has happened since early June, according to Mr Firman.

“There is no carpet, it hasn’t been painted and there are serious defects that need to be rectified, so there’s still quite a bit of work,” he claimed.

The 54-year-old said he even went to Blint’s office twice in June to find out about the progress of the home.

But since then the builder has “disappeared off the face of the Earth” with Mr Firman’s calls and emails going unanswered, he claimed

“It went from talking to him every day to him never ringing me back and never hearing from him,” he said.

Being left in limbo has taken a toll on him with the online retailer saying he has “never felt more depressed in my life”.

“It’s a massive strain on us as a family, both financially as we are paying rent as well as paying off part of the house that we can’t even live in it as we have no occupancy certificate,” he added.

‘Sending us broke’

Mr Firman said they can’t get a payout from the insurance company until Blint goes into liquidation and it could “cost a lot of money to force that to happen” through the courts.

“Even with the full insurance payout it might not be enough money. We skimped and saved and borrowed quite a substantial amount of money. We are worried we won’t make enough money to repay the loan and be able to live,” he said.

“I fear that this will send us broke.

“It’s very touch and go for us at the moment … My daughter turns 21 next month and her only wish was to have the party at the new house and that won’t happen.”

‘Derelict sites’

Dad-of-three Jamie* had also signed up with Blint in March 2021 to renovate and extend their two bedroom house in the Melbourne suburb of Murrumbeena for $730,000.

The family had planned a double storey addition out the back with a new kitchen, living area and kids’ bedrooms and are currently living in a rental.

Jamie said the work was “slow going” and the family had forked out $600,000 so far.

Now they’ve been left with a half built home, even though it was due to be complete in April, and he describes the site as “quite derelict”.

Jamie confronted the builder at his home in June and was told Rodger Reidy had been appointed to handle the voluntary administrators.

But when he contacted the insolvency specialist firm he was told that it was not the case and Rodger Reidy also confirmed with news.com.au they had not been appointed.

Now, he can’t get in touch with Blint with the phone turned off and emails unanswered.

The 43-year-old said he just wants to be able to finish the home, even if it costs the family an extra $50,000, but he has been left in limbo, adding he is “exhausted and frustrated”.

News.com.au understands a number of suppliers are also owed money from Blint.

*Name changed for privacy reasons

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Business

Collapsed building company Willoughby Homes taken to court to be liquidated

The stark reality of a building company’s collapse has been laid bare after the firm proposed that trade creditors would receive 10c back for every dollar they were owed.

On Wednesday afternoon, Sydney-based builder Willoughby Homes was brought to court with creditors calling for it to be put into liquidation because the business was “hopelessly insolvent”.

Gyprocking company Regno Trades initiated legal proceedings against Willoughby Homes early last month over an unpaid debt of $184,000.

That means if they followed through on Willoughby Homes’ proposal for receiving 10c in the dollar, Regno Trades would only recover $18,400 – leaving them $166,000 out of pocket.

Two business days before the hearing, Willoughby Homes appointed David Mansfield and Jason Tracy of Deloitte’s turnaround and restructuring department as voluntary administrators, causing creditors to suggest this was an “11th hour” attempt to save the company.

Judicial Registrar Claire Gistham, of the Victorian Supreme Court, granted the administrators of Willoughby Homes an adjournment until the end of the month to come up with an official Deed of Company Arrangement (DOCA), which is essentially a plan for creditors to get their money back.

In the heated court case, representatives of creditors argued that the company had “failed so miserably” and should be wounded up immediately because there was “an overwhelming case for insolvency”.

During the hearing, it was also revealed that Willoughby Homes owed up to $4.4 million to homeowners, trade creditors and the tax office.

Despite that, the construction firm has “minimal assets” and only has $14,000 in liquid cash in its accounts at the moment.

It comes after an extensive news.com.au investigation over the last month found Willoughby Homes has been non-functional for some time, with debts to creditors going unpaid, build sites stalling for as long as a year, the company’s home building insurance not being reinstated and finally, all its offices being cleared out and phone lines going straight to voicemail.

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Regno Trades acted as the plaintiff while three supporting creditors also joined the case – H & R Interiors owed $73,925, an ex-employee owed $53,000 in unpaid wages and Finese Electrical and Air Conditioning, owed $4531.

Another creditor, Kamaljit Pawar, also joined the case. The Sydney man built a house with Willoughby Homes in 2014, which was left with significant defects and he has been fighting to have them fixed ever since.

There are 44 impacted homeowners, 16 of whom have houses at “varying stages of construction” while the other 28 customers have handed over deposits but no building has commenced.

There are also a number of creditors and employees impacted. It’s understood employees are owed $67,000 in unpaid superannuation and about $600,000 is owed to deposit holders. Over a million is owed to the Australian Taxation Office.

There was debate about how much the company actually owes in total, with administrators putting the figure at $2.3 million but Mr Pawar’s lawyer Rodney Kent said he’d reviewed documents and said it was higher.

“There are substantial defaults” amounting to $4.5 million, he said.

Mr Kent also added that the owner of Willoughby Homes, Steve Willoughby, had four properties and possibly five, which could be sold to pay back debts.

SC Peter Fary, acting for the plaintiff and three supporting creditors, called for Willoughby Homes to be placed into liquidation because it had “failed so miserably”.

“This isn’t the first winding up application, in fact it’s not even the first winding up application this year,” he said.

“One has to ask why the director hasn’t caused the company to address its insolvency at an earlier point in time.”

He said it made no sense for the company to remain in administration because Willoughby Homes was unable to carry out any construction work.

“Is it seriously suggested that a company with no capital will continue building contracts in administration where it failed so miserably before?” I have asked the court.

“These matters go to another issue of commercial morality,” he added, urging the registrar to consider “Whether as a matter of commercial morality it’s appropriate for this company to continue in existence”.

Mr Fary said Willoughby Homes had “minimal assets and significant liabilities”.

In the hearing, it was stated Willoughby Homes only had $14,000 in cash as well as some motor vehicles, property and equipment that it could sell to pay back debts.

Administrators called in at the ’11th hour’

The lawyers representing creditors were also critical of the last minute appointment of administrators, last Friday, when they said it appeared likely that the firm had been trading insolvent for months.

“This is an 11th hour appointment, the appointment of an administrator at the last minute should be treated with skepticism,” Mr Fary said.

“One can’t escape the conclusion of these facts that there is likely to be an insolvent trading claim of a significant magnitude.

“One can readily infer that insolvency was some time ago.”

Mr Kent agreed, adding: “This is so late in the day and so inappropriate… Deposit holders have lost their money in circumstances where signing contracts was totally illegal.”

However, the administrator’s legal team argued that it was far from an 11th hour appointment.

QC Hugh Smith, representing the administrators, argued, “We’ve all been involved in 11 hour appointments, this is not that.”

Administrators were appointed late on Friday, giving them two business days – Monday and Tuesday – to sort out the company’s finances.

“As such this is not an 11th hour appointment,” Mr Smith insisted.

In another twist, the administrators insisted that a category of creditors – the deposit holders – be paid back in full while all the other credits only received 10c in the dollar.

The Deloitte administrators held a meeting for deposit holders only on Monday ahead of the court hearing and claimed a vote was 100 per cent in favor of the resolution to keep the company in administration so that they would receive their promised funds.

However, register Gistham grilled the QC on how many people actually voted, which turned out to be only 15 people.

“The priority here is quite extraordinary, on the one hand you’ve got 100c in the dollar, and the other hand is 10c to the dollar,” Mr Fary said.

“My client is as vulnerable as anybody else, all of their businesses are at risk of going under as well if they’re not paid,” Mr Kent added.

Later on, in a conversation with news.com.au, Mr Kent added: “It’s disappointing that their first meeting only involved certain creditors and not all of the creditors. I’ve never seen this done before. My client didn’t even know that meeting was taking place.”

After opposition, the administrator’s lawyer indicated they would reconsider whether 10c in the dollar was appropriate compared to 100c in the dollar for deposit holders.

The registrar added the case until August 31.

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